wicked chocolate count. i'm not counting the calories on that. "situation room" starts right now. >> thanks very much, brooke. your social security checks are at risk. officials here in washington try once again to strike a deal to raise the debt limb. media mogul rupert murdoch is summoned in to face lawmakers who are investigating phone

hackers within his media empire. i'm wolf blitzer in "the situation room." all right, bargaining over america's debt under way right now. president obama went into the fourth round of talks in recent days, upping the ante. he's suggesting that failure to reach a deal by the august 2 deadline could immediately cost many americans who rely on a government check to get by. they're meeting inside the west wing as we speak. what's the latest. >> as we speak, wolf, this is really the first time we've heard the president specifically illustrate consequences that will make many americans ears perk up. this as this meeting continues. no cameras allowed today for a photo opportunity as president obama talks with the top eight democrats and republicans in the house and senate is an impasse over tax increases continues.

>> as an impasse over tax increases continues. president obama illustrated a nightmare scenario where social security payments stop going out if the u.s. fails to raise the debt ceiling by august 2. >> i cannot guarantee that those checks go out on august 3 if we haven't resolved this issue. because there may simply not be the money in the coffers to do it. >> after the president's interview with cbs news, white house press secretary jay carney said the repurr cushions could be even more widespread. >> that would then entail a kind of sophie's choice situation where you have to dpe side what bills you can pay. and the fact is that whether it's social security checks or veteran benefits or disability benefit, it's pretty clear the affect will be significant. >> republicans call these comments scare tactics and are increasing their rhetoric against the white house. senate republican leader mitch mcconnell delivered this sharp barb just hours before meeting with the president.

after years of discussions and months of negotiations, i have little question that as long as this president is in the oval office, a real solution is probably unattainable. >> the speaker john boehner pushed back on calls for republicans to make tough choice ace long with democrats, insisting it's the white house that is failing to budge. >> house republicans have a plan. we passed our budget back in the spring, outlined our priorities. this debt limit increase is his problem. and i think it's time for him to lead by putting his plan on the table. something the congress can pass. >> carney called the comments unfortunate, saying a failure to raise the debt kreeling is everyone's problem. >> if we were to default on our obligations, who suffers. democrats, republicans or americans? americans suffer. the american economy suffers. the global economy suffers. >> now owolf, this meeting

continues inside the white house. we'll be waiting for the end of it so that we can find out some of the things discussed. we do know from mitch mcconnell, he was going to present a fall back plan that would essentially change how the debt kreeling is raised, allowing the president to decide how to do so in a way that would practically allow the congress to pass a debt ceiling increase without a majority of votes. response from capitol hill has been muted. the white house has not immediate panned nor supported it. but the president said he would veto a short-term solution. >> do we node what kind of spending cuts the mcconnell alternative plan might entail? >> according to our reporting, it would not include any spending cut, wolf, which is kind of the curious thing about this. and so senate republicans saying really when it comes down to it, they're trying to make the debt kreeling is increased. but without spending cuts, this is not something that would

appease tea party voters for sure, and so its future in the house of representatives is certainly questionable to say the least. >> all right, that meeting started about an hour and 15 minutes or so ago. we have our cameras and our microphones outside the west wing of the white house. you can see the microphones right there. if any of them come, if any of the republicans or the democrats or white house officials come to the microphones to brief us on what happened in today's critical meeting, we'll, of course, have live coverage here in "the situation room." we're watching closely the doors over at the west wing of the white house. meanwhi meanwhile, there's a killing in afghanistan that the top u.s. commander is now calling unfathomable. the half brother of hamid karzai gunned down in his own home. ahmed wally karzai was an influential figure inside afghanistan and a very controversial one who had deep connections with the white house. let's bring in our pentagon correspondent chris lawrence. lots at stake here as well, chris.

what do we know? >> wolf, afghans who have been complaining about corruption in the afghan government probably will shed no tears at the death of ahmid wally karzai. on the other hand, he helped hamid karzai exert fouer down in the south in kandahar where the president probably would not have been able to exert that power. so his loss british columbiaens karzai at a time when negotiations with the taliban move forward and it also may have very big repercussions for the u.s. effort in the south. people called president hamid karzai's brother a corrupt gangster. but the cia's former head of counterterrorism says the u.s. may miss him. >> it's quite like live that what follows is going to be something that will not work to our interest. >> reporter: an afghan official says he was gunned down in his own home, shot in the head and chest by his own guard. the taliban took credit, but

it's not clear if the shooter was really working for them. >> the united states condemns in the strongest possible terms the murder of president karzai's half brother in kandahar. >> a u.s. official said quote, while we must deal with ahm ahmed wali karzai, he's widely understood to be corrupt and narcotics trafficker. the state department and u.s. military were trying to build trust in the afghan government. they frequently criticized ahmed wali, but the cia worked with him. >> i think often parts of the u.s. government were working at cross purposes where ahmed wali was concerned. >> but as the u.s. lo rered its expectations for afghanistan, that criticism subsided. they said karzai did the one thing at the end of the day is most important to the united states -- >> we can call him a war lord.

he's our kind of warlord. in an area he controls he's not about to allow international terrorists, or even the taliban to operate with impunity. >> and a defense official says it's too early to tell what the fallout is going to be in kandahar where ahmed wali karzai had power. >> you see the casket now arriving, the casket carrying the body of the late first lady of the united states. she's being brought inside. guests have convened including the former president of the united states, bill clinton, the

secretary of state, hillary clinton, the first lady of the united states, michelle obama. unfortunately, bill clinton was supposed to be there, but there's been a problem with his flight. so he hasn't made it. but the first lady is there and the former first lady, hillary clinton among other dignitaries who arrived in rancho mirage. we're going to show you parts of this memorial service over the next two hours. so stand by for that. meanwhile, there's other news we're following including a war of words now heating up between syria and the united states. after protesters attacked the american embassy in damascus. the secretary of state hillary clinton declaring the president lost legitimacy. arwar, update our viewers. the regime over there is responding angly to what the secretary of state hillary clinton said.

>> they most certainly are, wolf. and we heard from a presidential adviser who did sound fairly apologetic about the attack on the u.s. embassy. but she was incredibly harsh. she's responding to hillary clinton's statement that the syrian president lost legitimacy. >> i would like to say to the secretary of state, it's not herself who gives legitimacy. it is the people of syria. and i think they should give up this imperial attitude of saying who's legitimate and who's not legitimate. it is now the role of the people to decide who's legitimate in their country. and i think it's an obligation of the largest democracy in the world to support the peaceful transition to democracy in syria. >> she also said when it came to the blatant support of the united states for the opposition against citing the ambassador's

controversial trip last week, that was an indication the u.s. was intent on meddling in syria's internal affairs that the u.s. wanted to try to destabilize the regime. she said that by going to the ambassador and the united states and the west were making it clear that they were, by siding with those who were saying no to dialogue, were in effect saying yes to violence. wolf? >> did she promise that the syrian government, the syrian security forces would live up to its international treaty obligations and protect the united states embassy? damascus from these thugs? >> she clearly said that syria underwhat its international obligations were. she said the syrian security forces responded immediately, that a number of individuals were arrested, that others were being held accountable. they were slow in responding

with one official that it was questionable that the syrian government was behind. >> thank you. questions about a possible chris cover-up and corruption in the phone hacking scandal that's exploding in rupert murdoch's media empire. plus, just days before casey anthony walks free, police defend their failed attempt to get her convicted of murdering her daughter. stay with us. you're in "the situation room." mine was earned over the south pacific in 1943.

vietnam, 1967. i got mine in iraq, 2003. u.s.a.a. auto insurance is often handed down from generation to generation, because it offers a superior level of protection and because u.s.a.a.'s commitment to serve the military, veterans, and their families is without equal. begin your legacy. get an auto insurance quote. u.s.a.a. we know what it means to serve. to your kids' wet skin. new neutrogena® wet skin kids. ordinary sunblock drips and whitens. neutrogena® wet skin cuts through water. forms a broad spectrum barrier for full strength sun protection. wet skin. neutrogena®.

>> as the fallout intensifies over the hacking scandal that brought down the british tabloid "news of the world" the ceo of the parent company news corp, that would be rupert murdoch and his son james and former "news of the world" editor rebecca brooks have all been asked to testify before parliament next week. ought to be interesting.

chances are the murdoch's troubles won't be contained to that side of the atlantic. news corp could face probes here in the united states for possibly violating bribery laws. investigations into whether news of the world journalists engaged in practices here as well. the daily mirror recorded claims by a new york city police officer that "news of the world" offered him money to get into voice mails and phone records of 9/11 victims and their families. that's pretty sick. where does it end? the news corp media empire goes far beyond tabloid newspapers here. murdoch owns many newspapers and tv stations.

you have to wonder what others might be engaging in. on sunday's "fox news watch" program over there on the f-word network, the panel didn't discuss the british scandal on the air. instead they talked about things like the casey anthony trial and the ongoing sexual assault case against dominique strauss-kahn. however, on the fox news website in the "behind the break" segment, the panel talks about the subject we're not talking about today, unquote, and at one point, the hosts are jokingly daring each other to bring up the topic. not surprisingly, nobody did. here's the question -- in light of alleged crimes in england. should the u.s. government investigate rupert murdoch's companies in the united states? go to cnn.com/caffertyfile to post a comment on my blog.

we have a tip of the iceberg here or not. but it might bear looking into. >> well, i checked today in the new york post. i didn't see any -- virtually no coverage of the phone hacking scandal in england. although "the wall street journal," they did lead the second section of their newspaper with extensive coverage of it, so, you know, new york post not so much, wall street journal, considerably more. >> i think "the wall street journal" has a little more editorial freedom in the murdoch empire than the "post" does. it's cooped of the u.s. answer to those british tabloids and very much follows the company line. but i think the "journal" has a little more latitude. >> jack, thank you. british law makers aren't waiting to hear testimony from rupert murdoch. they're aggressively investigating the phone hacking scandal that's tainting his media empire. today's focus, possible police corruption and cooperation. here's cnn's senior national correspondent dan rivers.

>> called before politicians to answer accusations of systemic corruption incompetence and collusion with news international, their answers were telling. >> tles's corrupt people. we know that. there always balanced budget will be. >> so who did take bribes? he led a criticized investigation against the company for phone hacking in 2006. >> while a police officer, did you ever receive payment from any news organization? >> good god. absolutely not. i can't believe you suggested that. >> lots of people did. >> come on. i'm not letting you go over there that. absolutely no way. i can say to you --

>> mr. haymon. >> that's not fair. >> the policewoman leading the investigation says the reputation of the entire metropolitan police force is now on the line. >> i think it's everybody's analysis that confluence has been challenged. and i don't doubt if we don't get this right it will continue to be damaged. >> it came on a day of more sensational developments with former prime minister gordon brown, speaking of his shock at suggestions his family's intensely personal data was hacked. >> the "sunday times" got access my building society account, they got access to my legal files. there's some question mark about what happened to some other documentations, file, tax, and everything else. but i'm shocked, i'm genuinely shocked to find this happened because of the links with criminals.

>> it is a stinging accusation for news corporation's rupert murdoch and his chief executive rebecca brooks. they insist they knew nothing of nefarious accusations. but already public support is crumblin crumbling. david cameron suddenly agreeing with the opposition that news krorp's controversial takeover of satellite broadcaster b sky b should be blocked. and on top of that, rupert murdoch along with his son james and deputy rebecca brooks have been all been called to appear before another powerful parliamentary committee. if they turn up, what they say could be sensational. >> investigators in the casey anthony murder trial are speaking out only days after her acquittal. is there anything they could have done differently to change the outcome of the case? plus, republican presidential candidate ron paul making a dramatic announcement about his own future in congress.

we'll have details coming up. the ultimate business phone -- t the motorola expert from sprint. its powerful tools help you work faster and smarter so you can get back to playing "angry birds." it lets you access business forms on the go, fire off e-mails with the qwerty keypad, and work securely around the world so you can get back to playing "angry birds." it's the android-powered phone that mixes business with pleasure. so let's get our work done, america, so we can all get back to playing "angry birds." the motorola expert from sprint. trouble hearing on the phone? visit sprintrelay.com.

my son and i never missed opening day. but with copd making it hard to breathe, i thought those days might be over. so my doctor prescribed symbicort. it helps significantly improve my lung function, starting within 5 minutes. symbicort doesn't replace a rescue inhaler for sudden symptoms. with symbicort, today i'm breathing better, and that means... game on! symbicort is for copd, including chronic bronchitis and emphysema. it should not be taken more than twice a day. symbicort may increase your risk of lung infections, osteoporosis, and some eye problems. tell your doctor if you have a heart condition or high blood pressure before taking it. [ whistle ] with copd, i thought i might miss out on my favorite tradition. now symbicort significantly improves my lung function, starting within 5 minutes. and that makes a difference in my breathing. today i'm back with my favorite team. ask your doctor about symbicort. i got my first prescription free. call or click to learn more. [ male announcer ] if you can't afford your medication, astrazeneca may be able to help.

>> ron paul announcing he won't seek re-election next year in the house. some other top stories in the situation room right now. what's going on? >> the texas representative who's held his seat on capitol hill for almost 24 years says he now wants to focus his efforts on winning the presidency. he's adding today's aknownment says he will give candidates thinking of succeeding him more time to prepare. and the investigators who said

casey anthony killed her daughter are depending their investigation but also urging the public to respect the jury's verdict. >> with this many witnesses and this much evidence, you can always look back and improve on what you've done. i don't know that anybody up here cowl think of anything we could have done differently that might have affected the outcome. >> anthony was convicted on four misdemeanor counts of lying to investigators and was given the maximum sentence of four years in prison. but she's scheduled to be released this sunday. and julian assange is trying to block a ruling to be extradited from sweden to britain. he's being questioned there. he denies the sexual misconduct allegations. wolf snf. >> all right, deb, thank you.

we've got a brand-new and rather surprising poll that's just coming out. it shows that president obama is less popular than president bush than some parts of the arab world. stand by. we'll tell you what's going on. and details on the controversy surrounding a counseling service run by republican presidential candidate michele bachmann and her husband. hey can i play with the toys ? sure, but let me get a little information first. for broccoli, say one. for toys, say two. toys ! the system can't process your response at this time. what ? please call back between 8 and 5 central standard time. he's in control. goodbye. even kids know it's wrong to give someone the run around. at ally bank you never have to deal with an endless automated system. you can talk to a real person 24/7. it's just the right thing to do.

but afraid you can't afford it? well, look how much insurance many people can get through selectquote for less than a dollar a day. selectquote found, rich, 37, a $500,000 policy for under $18 a month. even though dave, 43, takes meds to control his blood pressure, selectquote got him a $500,000 policy for under $28 a month. ellen, 47, got a $250,000 policy for under $20 a month. all it takes is a phone call. your personal selectquote agent will answer all your questions ... and impartially shop the highly rated term life companies selectquote represents for your best rates. give your family the security it needs at a price you can afford. call this number or go to selectquote dot com. selectquote. we shop. you save.

pro democracy uprisings, long-time leaders toppled or in peril. wars in iraq and afghanistan winding down somewhat and the death of osama bin laden. against that backdrop, a rather surprising new poll of attitudes in the arab world in the united states. one headline, favorable hate raittings for president obama and the united states have plunged even lowner some cases than they were at the end of the bush administration in most of the arab countries surveyed.

joining us now is the of the arab american institution, james zogby. thanks for coming in. >> thanks. >> it's pretty shocking. this entire report is detailed. the favorability rating of the yao its in much of the arab world is lower now than it was under president obama than it was during the bush administration. why? >> that's because it spiked so high after president obama was elected and after the cairo speech, it went even higher, but the expectations have not able to be met and therefore there's been a deflation. the only country where attitudes are a little bit better are in saudi arabia which i think is interesting by itself. but in awe the other countries, there were a sense that people were hopeful but they've been let down. >> the be the went to cairo, gave a speech to the arab world, gave a speech to the islamic

world. in turkey, as you remember. it's barack hussein obama. he's tried to revitalized arab-israeli peace process. have plummeted. >> as the president himself noted in the speech in cairo, a speech alone wouldn't do it. he did not get handed a magic wand when he got elected. he got handed the shovel his predecessor had been using to dig a deep hole. and getting out of those holes has been very difficult. and congress hasn't been helpful. the president tried to lay down a marker with netanyahu on the '67 borders. >> are people in the arab world blaming him for a you would othat have? >> they're not blaming the president. they're disappointed in america. they're let down. they feel that maybe no president can make a difference. that's another finding we get. maybe no president can make a difference. >> what about what the united states has done, tried to do for arabs. in libya, for example. >> he gets -- the president gets high points in sab rainbow yeah for libya. but across the region, it's a

minuscule issue of importance. >> he led the effort to get a no-fly zone in libya. >> when you look at rank order priorities, palestine is number one and the president knows that. u.s. interference, iraq is a huge one. the president knows that. getting out of iraq is critical. libya was way down. it was single digits in terms of how important is this issue to you. and so the fact is -- >> what about what the u.s. did in egypt in getting rid of mubarak? >> they don't see the u.s. did anything. they see tahrir square as doing it. but now they need job aebs economic opportunity. they're not getting those. the president was right in his speech at the state department. we have things to do. but things aren't getting done. we're not investing in the region. we're not turning this arab spring into something that can blossom with new opportunities for people. >> i think one of the shocking

things as i found in this report, iran, which is a traditional adversary, iran being a persian country has a higher favorability rating in much of the arab world than the united states of america. >> that is true, but iran is viewed as a menace and a threat in several countries. we're coming out with the second half othis pole in two weeks and it is shocking actually how iran is viewed as a threat in iraq, in lebanon in in the palestinian issue and in the gulf region itself. they're viewed aez meddling across the region and a problem. but the u.s. is still the big bully on the block. >> .and what's shocking is the killing of osama bin laden hurt the u.s. image in the air rob world. it didn't help. >> it's like if the neighbor has been messing around with your wife, comes over and trims your bushes and takes your garbage out, it's not going to help the situation. the big issue for the arabs is

not bin laden. it's palestine. and that we haven't resolved. in fact, with eeve enabled the israelis to commit acts of bad behavior and that's taken a real toll on american standing. the president made some promises on cairo of things he was going to try to do. >> the poll is fascinating, these numbers. thanks very much for coming in. we'll talk to you in a few weeks when part two. co-s out. >> a new republican investigation may be in the works. president obama aggressively using the white house for political gain. and we're learning more about an elaborate ruse used by the cia when it was trying to move in for the killing. which are one . the authentic, the rare, the hard to define. to those always searching for what's pure and what's real from we who believe we know just how you feel. haagen-dazs. from we who believe we know just how you feel. somewhere in america,

there's a doctor who can peer into the future. there's a nurse who can access in an instant every patient's past. and because the whole hospital's working together, there's a family who can breathe easy, right now. somewhere in america, we've already answered some of the nation's toughest healthcare questions. and the over 60,000 people of siemens are ready to do it again. siemens. answers. right now, go to priceline for a sneak peek at recent winning and better than ever! hotel bids to find where you n save up to 60% on hotels. * we'll even email you other people's winning bids, so you'll know what price to name. *á with new hotel bid alerts, from priceline.

>> let's bring in our own brian todd. what is going on? >> wolf, a very ambitious republican congressman, head of a congressional watchdog committee is going after the president for this, saying he may have broken federal laws. what darryl issa wants to know is this is the set selling of the lincoln bedroom all over again. a probe which could make the president long for these days of intense partisan talks. darryl issa says the administration has fired off a letter to president obama.

he's fired off a letter to president obama. in his letter, isssa crites various reports to solicit donations. in issa's cross hairs, a meeting in the white house in march of top american business leaders. they were all campaign donors and the meeting was organized by the democratic national committee, the white house has defended that. >> having a dnc or rnc-sponsored event is extremely common for presidents of both parties going back many administrations. >> but crucially important is what was discussed at the meeting. the white house says the only thing talked about was economic policy. if that's the case, experts tell us, the meeting would not have violated federal law. but if they discussed fundraising, it would have. issa is not convinced the white house is being forth coming. >> you're talking with your contributors. what are you talking about if not your re-election. >> that the white house's

fundraising was not discussed that day. saying you didn't talk about it begs the question, the democratic national committee did not need to be present and should not have been present if this was an official activity. >> still, several lawyers, campaign finance experts and analysts on both sides of the aisle say that on its face that meeting did not violate the law, even if having the dnc involved didn't look great. >> if the president is inviting ceos over to discuss the american economy, no, the invitation shouldn't have come from the dnc but that's far from a serious offense. >> but congressman icssa is not stopping there. h he's also demanding records on the production of this video. >> the president there appealing to donors for a contest. a prize, a dinner with him for joe biden. issa says because the video was shot inside the white house, it

may have violated campaign fundraising laws. wolf? >> but it depends on where inside the white house that video was shot. >> the white house says this was fi filmed inside the white house private residence. in that case, no laws were broken. >> i remember covering the clinton white house and other white houses. and these questions come up all the time when an incumbent president is seeking reelection. >> understand nooed materials. >> thank you. republican presidential candidate mitt romney's jobs record under fire right now on the republican campaign trail. why one key challenger now says the facts speak for themselves. plus, much more on the shocking assassination of the afghan president's half brother. what will it mean for the united states mission in the region? stand by for details. that's about 34 million pounds of mail every day. ever wonder what this costs you as a taxpayer?

millions? tens of millions? hundreds of millions? not a single cent. the united states postal service doesn't run on your tax dollars. it's funded solely by stamps and postage. brought to you by the men and women of the american postal worker's union.

>> right to our strategy session. joining us is a democratic and republican strategist. thanks so much for coming in. did i say paul begala? >> i'll pretend i'm paul. >> let's talk about what's going on in the republican presidential race. huntsman versus romney. listen to huntsman talk about romney's record as governor of massachusetts.

>> 47th is 47th. first is first. just let the spaks speak for themselves. he says utah was number one creating jobs. massachusetts was 47th in creating jobs. i know you worked for romney. your son now works for huntsman. you're neutral in this republican contest right now. but how angry, how bitter is this going to get between romney and huntsman. >> if michelle bachmann wins iowa, they're going to go to new hampshire and look for the anti-bachmann. maybe we need a more established republican.

it won't be won on economic issues. >> it's fascinating. at the same time, we see romney and hunt manslaughter going after each other, huntsman going after romney, arguably the front-runner right now. we see the little battle between the two minnesota candidates. you like seeing this kind of fight among republicans. >> the nomination for president of a political -- major political party is worth something. and people get into it. the intensity in these primaries is worse than in a general election. i talked to people about the

reagan-ford '76 election. churches split up over that. it was very intense. and it's going to get this way. romney does have a problem as i understand it, his job creation record in massachusetts and also kennedy really beat him bad. i think it was in '94 by getting people who were fired by him. i'm sure they got a good campaign and they'll deal with it. >> debates can be contentious. but at the end of the day, everybody pulls together for christmas. >> james raises a good point. his wife was on the show yesterday and she suggested she's increasingly coming around to the conclusion that sarah palin will, in fact, run for the nomination.

alex, do you think she will? >> no, i don't see that. michele bachmann has filled that space. sarah palin has become really so in some ways out of the picture as a political candidate, it's almost like she had become the vice president. nobody thinks of her that much anymore. she's figured out what i think all of us can say see. her place is not at the top of a ticket, but she can still bf very powerful and effective for principles she generally cares about. >> do you agree with mary or alex, james? >> i think for the kind of very reason that alex said. one of the reasons is she wants to get in the middle of this. this is a big stage here. and people don't want to miss out on it. >> if she does run, alex i'm wr

first -- >> if she does run, none of us know, her daughter, bristol, said her mom has made up her mind. we don't know what that decision is. if she runs runs, does she in emerge as a front-runner? >> she emerges as a front-runner. michele bachmann is not to be underestimated in iowa. that's her home. she was born there. she has a powerful ground game there and message that resonates. i think what that would do, it would split that conservative vote in iowa between bachmann and palin and all of a sudden it might make iowa a state that a romney or huntzman or pawlenty could win. >> right now romney is doing well in iowa. nowhere in the polls in the last polls we've seen in the past few days. increasingly, james, michele bachmann, she's atop the iowa polls today and yesterday. >> yeah, no, and, look, she's had a good run here. you know, it's going to be

interesting. you know, huntsman, the one thing is, no one has ever won the republican nomination without winning either iowa or new hampshire. there's a lot of theories about how people cannot do that. if huntsman doesn't run in iowa, it's going to be hard to see him doing very well in new hampshire because somebody is going to get a lot of publicity. run an unexpected close second, that helps you a good deal. once these primaries start or caucuses start, that's where the coverage is. that's where wolf blitzer is going to be. that's what people are going to see. that happens every cycle. people tend to forget that. >> james, alex, we'll leave it on that note. we'll spend time talking about it in the weeks and months to come. guys, thanks very much. that meeting by the way at the white house has just wrapped up. the meeting the president had with the democratic and republican leaderships. we're standing by. you're looking at microphones there outside the west wing of the white house. if they come to the microphones

and tell us what happened, we'll immediately go there live. stand by. republicans as many of you know have come up with complicated plan "b" to try to raise the debt limit and prevent the u.s. from defaulting. will president obama buy it? and polygamists featured in a reality tv show are now doing battle against the state of utah to try to protect their multiple marriages. [ male announcer ] introducing the ultimate business phone -- t the motorola expert from sprint. its powerful tools help you work faster and smarter so you can get back to playing "angry birds." it lets you access business forms on the go, fire off e-mails with the qwerty keypad, and work securely around the world so you can get back to playing "angry birds." it's the android-powered phone that mixes business with pleasure. so let's get our work done, america,

so we can all get back to playing "angry birds." the motorola expert from sprint. trouble hearing on the phone? visit sprintrelay.com.

personal pricing now on brakes. tell us what you want to pay. we do our best to make that work. deal! my money. my choice. my meineke. back with the cafferty file. jeff? >> question this hour, wolf -- the united states government investigate rupert murdoch's companies and properties here in the united states.

ken in washington writes, it's hard to believe the kind of grievous activity murdoch's minions engaged in over so long a period of time could possibly be limited to britain. he has the reputation of being a hands-on manager. so one has to believe he knew what was going on. if he's amoral enough to conduct business in such a despicable manner then they must have done the same thing here in the united states. david in tampa florida, "yes, jack, not what they print so much as how they obtain their information." rs in detroit, "every inch of rupert murdoch's criminal empire needs investigating. this is a powerful organization with its tentacles in everything further corroding our political system." janice in arkansas, "yes, they should start with fox news. i don't believe it was a coincidence their website was hacked a few days ago with the report of president obama's death." chicka in south africa, between you and me and millions of

others, we'll want nothing more than a thorough investigation of murdoch's so-called media empire. question should have been, do you think the american government has the courage to investigate ruppert mert murdoc his companies? he acts as if he's untouchable. ann writes the murdoch empower is corrupt. it always has been. he own his cronies don't bother hiding it anymore. case in point, fox news. if the public doesn't demand clarification, then we're complicit in allowing one man's delusions of power to erode our society. news corp has done so much damage already, we owe it to ourselves to prevent them from doing more harm. dennis in florida, it seems like a good idea. i am sure some of the middle manager types that received raises and promotions for promoting those activities in the uk shared the methodology with their u.s. counterparts. as usual, it stinks. read more on this, go to my

blog, cnn.com/caffertyfile. wolf? >> thank you. a bitter new court battle for the stars of a popular reality television show fighting for what they consider their right to live as polygamists. let's turn to cnn's casey wian joining us. he has the details. what's going on, casey? >> it's a fascinating case. reality tv show may settle legal precedent. well known washington, d.c., attorney, john thnathan turley his way to utah, the attorney of the "sister wives." cody brown and his four wives have been living an openly polygamist lifestyle in front of television cameras since last year. utah and the mormon church outlawed polygamy 120 years ago as a condition of statehood. some fundamentalists practice is. they open an investigation into

the browns' lifestyle last year and reportedly considering criminal charges perhaps very soon. their attorney says in a statement, we believe this case represents the strongest factual and legal basis for a challenge to the criminalization of polygamy ever filed in the federal court. we are not demanding the recognition of polygamist marriage but challenging the right of the state to prosecute people for their private relations. cody brown knew all along he was taking a risk by going on tv with his legal wife and three so-called sister wives. utah's attorney general for his part says the state has defended its law against polygamy several times in state supreme court. h it's going to be interesting to see what's happening now that it goes to federal court, wolf. >> quickly, casey, on what legal basis is turley planning to make the challenge? >> basically on the theory americans have the right to be left alone by their government and any intrusion on their religious practices is an

invasion of privacy. >> casey wian reporting. thanks very much. to our viewers, you're in "the situation room." happening now, a surging campaign. now an unwelcomed controversy for republican presidential candidate michele bachmann. questions swirling about her husband and a controversial therapy some say can make gay people straight. also, surprising reports of an elaborate ciaruse in afghanistan, whose real purpose was to get dna from osama bin laden family. a shocking killing in afghanistan. the brother of president hamid karzai asasassinated by his own bodyguard. we welcome our viewers in the united states and around the world. breaking news and political headlines all straight ahead. i'm wolf blitzer. you're in "the situation room." exactly three weeks away from the day when by all accounts the u.s. will hit its legally mandated debt limit and

possibly, possibly begin to default on its obligations around the world. with no progress in talks between the white house and congressional republicans, president obama's increasing the pressure now warning the social security checks may not go out on time next month unless, unless an agreement is reached. but with no deal in sight, some backup plans are now being floated, but they come ladened with baggage. let's get more from our congressional correspondent, kate bolduan. kate, what are you hearing on capitol hill right now? >> reporter: a lot going on, it seems, wolf. the clock as you very well point out, the clock is ticking. today the prospects of a deal seem to be fading with new proposals surfacing. despite continued talks inside the white house, outside, prospects of a deal appeared grim tuesday, with little sign of progress and both sides hardening their positions. >> the president talks a good game, but when it comes down to actually putting these issues on the table, making decisions, it

can't quite pull the trigger. >> protect millionaires and cut medicare benefits instead. this approach is not balanced. it's not fair. it's not moral. and it will not be accepted. >> reporter: and with little time left before the debt ceiling deadline, the top senate republican offered a pessimistic prediction. >> that the years of discussions and months or negotiations, i have little question that as long as this president is in the oval office, a real solution is probably unattainable. >> reporter: now mitch mcconnell is pitching his own so-called backup plan, a applicant compli proposal that would give president authority to request a debt limit increase without required spending cuts. >> legislation would authorize him to get to the amount he says he needs, based upon advice of his secretary of the treasury, in three tranches.

the first tranche, $700 billion. the second tranche, $900 billion. the third tranche, $900 billion. >> reporter: that authority comes with a catch. it would mean three politically tough votes before the 2012 election and if lawmakers voted against those increases the president would be forced to veto the measure, pinning on him the responsibility for the new debt. >> i'm not happy, and i hope we don't have to go to this option. i still want to cut spending. >> reporter: and, wolf, i'll tell you, my colleague just caught up with the democratic senator, dick durbin, who's involved in those negotiations. he returned back to capitol hill from the latest meeting. he says the senator is reporting that they're making progress and my colleague, ted barrett, did ask if the mcconnell plan, the proposal we're just discussing, is viable and the senator said that we are discussing that as one of the options. yes, at. at the very same time, though, wolf, the top democrat in the

senate, harry reid, he's floating his own idea, one that would reduce the debt by more than $1 trillion while not requiring new taxes or tax increases and not requiring any cuts to entitlements. it really is a show, a sign of the real, growing concern up here they may not cut a deal in time, wolf. >> encouraging dick durbin is sounding a little bit more hopeful than a lot of people only a few hours ago were sounding. jessica yellin is at the white house. we're going to check in with her later. we're going to get the latest information from all of these sides. thanks very much for that. kate bolduan up on capitol hill. what happens when the u.s. does reach i debt limit? cnn's tom foreman is looking at the implications of a government default. what could we expect if that were to happen? >> well, as you know, wolf, the problem is we don't really know what to expect. by in large what we're looking at is an earthquake moving through interest rates. because if the government can't pay its debt, it's kind of like you're not paying your credit card. the interest rate goes way up.

that can affect all sorts of interest rates. sbr for example, the average family sitting out there, one thing it could mean, interest rates on homes could raise. mortgages could raise at a time people don't need to see that and housing rates are already in trouble. take it out to the garage over here. in the garage, your rates for buying a car could rise. gas prices could increase as a result. roads, of course, could be much worse quality because the government can't afford to take care of them. what if you're one of the people that helps take care of the family? the father here, you can wind up enemployed if your dealer cannot deal with the rising costs. you can lose money, your savings plans, these are projections out there that seem to be varying degrees of validity. a lot of people seem to think these are all real possibilities. you have a difficult time getting a loan if you're a small businessman trying to grow a business at a time like this which means you won't hire anymore people. what if you're a mom and work for the government? you could be furloughed. you could secret card rates

rise. it's one of the concerns here. let me bring the house back where it belongs. what if you're the daughter in the military? your salary could be limited and delayed. you could be getting i.o.u.s from the government instead of a check. this is an important one. private contractors who provide things to government offices all over the country and the military and the people who are there could find themselves being, told, look, we cannot fulfill our contracts right now, we can't pay you. they could be pllaying off peop. what about the son who wants to t go to college? student loans could harder to obta obtain. restriction of aid. grandpa and grandma, retirement benefits reduced. here's the aftcatch in all of t, wolf. it keeps coming up in the talks. many of these things we're talking about also may have to be part of austerity measures as we try to bring our spending under control in the government. one way or the other you can see

how many voters out there, as we enter this uncertain, unknown zone, could truly be caught between a rock and a hard place. wolf? >> tom, thank you. good explanation. let's dig deeper with cnn's chief political analyst gloria borger and senior political analyst, david gergen. gloria, yours is entitled "a process hijacked by purists. "what do you mean by that? >> there are purists on both sides that won't let a deal with cut. i particularly talk about the republican purist here. i would argue the republican party which cared tremendously about the deficit and was also anti-tax and anti-big spending has now made a decision that the bumper sticker no new taxes matter s more to them than the deficit. the president and the house speaker were coming together on a deal that offered $3 of spending cuts for every dollar

of tax increases. republicans would have rejoiced about that, but not today. >> i hope we're going to get your mike fixed. hold on for a second. david, in your column, you suggest you're worried, you're deeply worried that the president right now has tied his own hands. what do you mean by that? >> well, yesterday he came down with a very, very hard statement that he would not accept any short-term patches. that anything up to 180 days was unacceptable to him. you heard earlier in the reporting, that's exactly what's now being put on the table by mitch mcconnell and by harry reid. the fact is, the negotiators are not able to get the big mega deal. they're not going to get there. everybody knows that now. the question is, can they get to a modest sized package? modest is $2.5 million to $2.7 billion. they're a long, long ways from that. billions of dollars away from that just with spending cuts. it's going to be very hard to get to that. we're looking at a short-term

patch. i always thought that. bill clinton has been arguing that. from my point of view, look, after i wrote yesterday that the republicans have painted themselves in a corner, as gloria said, the democrats have painted themselves into a corner. i was worried the president would paint himself in a corner. i had a call from somebody who's very high up, familiar of the president's thinking today and walked me through the president's thinking why he's opposed to a short-term fix. if you'd like i can go through that. >> hold on. i want to read gloria's column and get her to elaborate. you write, republicans are fond of claiming that obama does not pay homage to the notion of american exceptionalism. but how can you level that claim when your party is happy to let the nation default on its debts? >> yeah. i think that's a real problem for republicans. you have republican presidential candidates out there. tim pawlenty, for example, saying that he hopes and prays that the debt ceiling is not raised. well, what does that mean?

that means we're defaulting on our debts. michele bachmann does not want the debt ceiling to be raised. if we're to be a country people look up to, that our word matters, we should not be defaulting on our debt. that should matter to us, particularly to people who talk about the notion of american exceptionalism being important. >> the leadership in the meetings may be something the republican presidential candidates are willing to play this up. the leadership, the republican leadership that's been meeting, boehner and mcconnell and oa oathers don't want to see default. >> they don't want to see default. there's no give on either side. >> let's talk about the short-term proposal to try to get through this august 2nd deadline. david, the president yesterday made it clear he's not going to sign, not going to accept 30, 60, 90 or 180-stop gap measure. you think that's a mistake? >> i think he should leave himself wiggle room. after hearing from this high-ranking administration

official today, i'm much more sympathetic with what his arguments are about why he does not want to do a short-term deal. he feels, of course, the momentum will slip away for any kind of big major thing. if you delay the real negotiations several months, you get much closer to elections and it gets harder. this other issue, wolf, that's out there, and that is if we only get a short-term deal will the credit rating folks like standard & poors downgrade america's credit rating? that would cost us billions of billions of dollars. the president is anxious to avoid that. as i look at this, wolf, if it comes down to a choice for the president, either take the patch or go into default, he has to take the patch. >> the republicans are proposing a patch, now, david, that would essentially give the president all of the responsibility for raising the debt. they would have no fingerprints on it, essentially.

and, of course, they would get no spending cuts out of it as a result, but it seem s to me it doesn't work for either side. >> i'm not sure exactly. the mcconnell proposal is hard to read. they're not going to give him a clear and clean lift to the debt ceiling. they're going to insist on something in exchange. i don't think we quite understand that. i do think increasingly it looks like the deal is going to come out, whatever it is, that there is an agreement. a consensus as you pointed out, wolf, in the leadership, let's not go into default. what they're going to give the president is something he doesn't really want, a short-term patch. >> i love the way jay leno last night described this debate that's unfolding at the white house. i'll play the clip. >> democrats, republicans, still haven't come to any agreement over this debt ceiling and the -- you know, have you watched these people? go to c-span, show them arguing.

>> i say no. i say no. >> be quiet. >> you be quiet. >> you be quiet now. >> you be quiet. >> that's going to go on. >> i guess that about sums it up, guys. you can't do much better than that. i think you will both agree. david gergen, gloria borger, guys, thanks very much. the husband of a leading republican presidential candidate now accused of offering a controversial therapy designed to try to make gay people straight. and the brother of the afghan president assassinated in his own home. we have details as well about an elaborate ruse the cia used to try to get dna from osama bin laden's relatives. woman: saving for our child's college fund was getting expensive.

man: yes it was. so to save some money, we taught our 5 year old how to dunk. woman: scholarship! woman: honey go get him. anncr: there's an easier way to save. get online. go to geico.com. get a quote. 15 minutes could save you 15% or more on car insurance.

jack cafferty is here with the cafferty file. >> go figure. for a second straight day, a new poll, likely voters in iowa, voters in the caucuses there, has minnesota congresswoman michele bachmann as the front-runner among the current field of republican candidates. she's big with tea party voters.

running on smaller government, no new taxes. but she's come under criticism most recently from fellow minnesotan and gop candidate, himself, tim pawlenty, for not having much of a record on anything while she was in congress. she also has strong views on social issues that will likely turn independents and more moderate republicans off. last week, bachmann signed something called the marriage vow. penned by an uber-conservative group in iowa. it's a vow to be faithful to one's spouse and to the constitution. it condemns adultery, quickie divorces and pornography and describes homosexuality as a choice. the initial draft suggested life was better for black children during slavery because more african-american children are born out of wedlock now than they were back then. lovely. that part was later edited out and the group said it was all a misinterpretation.

is someone who would sign a document like that really the best republicans can do? apparently a lot of the voters in iowa think it is. then there's the question of who else might enter the race. specifically former alaska governor who quit in the middle of her first term, sarah palin, who's been playing games with the media for months now. in this week's cover story in "newsweek" magazine, sarah palin said she thinks she can be president. she made these comments followifollow ing the premiere of a documentary produced by a conservative filmmaker highlighting the positive aspects of her political career. it's not a very long film. palin also said even if she's not the nominee, she's not even in the race yet, she thinks president obama's beatable in 2012. maybe so. but not by her or michele bachmann. here's the question. michele bachmann's leading in iowa, sarah palin thinks she can be president. are the republicans in trouble? go to cnn.com/caffertyfile. and have some fun.

>> they will. we'll look forward to what our viewers think, jack. >> serve up those watermelons. >> yep. there's a growing controversy that's beginning to dog michele bachmann's campaign. it centers on her husband and the christian counseling center they own together where critics say controversial therapy is being used to supposedly cure homosexuals. cnn's jim acosta has been investigating this story for us. jim, what are you finding out? >> wolf, michele bachmann and her husband, marcus, run a christian counseling service that's come under scrutiny in recent years. the clinic bachmann & associates outside minneapolis faced accusations is encourages gay and lesbian patients to change their sexual orientation. we sat down with one of the center's former patients, andrew ramirez, went to bachmann & associates when he was 17 years old to talk about his own homosexuality. he was immediately spectacle about what he heard from one of

the counselors at the clinic. >> it was therapy that would help me change from being homosexual to straight. >> that's how he described it? >> yes. >> he basically said if you do this, what? you wouldn't be gay anymore? >> if i did this and worked his therapy program, god could perform a miracle and i could no longer be gay. >> this week a gay rights group called truth wins out released its own hidden video camera recorded by an activist that posed as a patient at bachmann & associates. a counselor suggests homosexuality can be treated at the clinic. that counselor also says in the video he's not an expert on the subject. >> a significant number can actually -- homosexually in the end become heterosexual. >> oh, yeah, yeah, definitely. oh, i believe [ inaudible ] it's happened.

it really has. >> the bachmanns declined our request for interviews. the campaign released a statement to cnn saying, quote, the bachmanns are in no position ethically, legally or morally to discuss specific courses of treatment concerning the clinic's patients. the republican presidential contender was also asked about this clinic on the campaign trail in iowa. she dodged the question. she did say she is proud of her family business and we'll have more on this tonight on "ac 3 60." >> we'll look forward to that. karzai, he wasn't just the afghan president's half brother, he's one of the country's most powerful, some would say notorious politicians. james whitey bulger's neighbors never thought he would be a mobster. they might have if they'd seen what was in his apartment. [ bird chirping ]

♪ [ doug ] i got to figure this out. ♪ [ dr. ling ] i want to spend more time with my patients. [ jim ] i need to build a new app for the sales team in beijing. [ mrs. davis ] i need to make science as exciting as a video game. ♪ [ jim ] i need to push out a software upgrade. [ dr. ling ] review ms. cooper's history. [ doug ] i need to cut i.t. costs. [ mrs. davis ] i need to find a way to break through. [ jim ] i need to see my family while they're still awake. [ dr. ling ] see if the blood work is ready. [ doug ] i need to think about something else when i run. ♪ [ male announcer ] every day, we set out to do more than the day before. at dell, everything we do, from solutions to services, gives you the power to do just that. ♪ so i.t. professionals can be more productive... business leaders, more innovative... doctors can be more connected to patients... and teachers have the power to make a difference.

dell. the power to do more. the authentic, the rare, the hard to define. to those always searching for what's pure and what's real from we who believe we know just how you feel. haagen-dazs.

the violence in afghanistan is hitting very close to home for president hamid karzai. his half brother ahmad wali car karzai, in kandahar, has been shot and killed, assassinated in his own home. and joining us now from islamabad, our national security analyst peter bergen. peter, this assassination of the half brother of hamid karzai, the half brother ahmad wali karzai, who is responsible for this? >> it's still a little murky about who's ultimately responsible. it's clear one of his bodyguards, a longtime associate, killed ahmad wali karzai, had access to him, was

able to this. quite what his motivations are are murky. the taliban have claimed responsibility. the fact is ahmad wali karzai, known as awk in afghanistan, had a wide range of enemies inclu including people potentially within his own family which is pretty large. but also, you know, people in the political scene in kandahar, which he controlled largely, there were allegations he was involved in drug trafficking. you know, so, wolf, you know, while we know the identity of the assailant, we don't really understand the motivations and who put this bodyguard up to this attack. >> how did it happen? >> well, the bodyguard took him into a room and obviously this is somebody that had spent, you know, many years around ahmad wali karzai and, therefore, you know, wouldn't have been surprising he was able to take him into a room and, you know, then he shot him. so, you know, it's a pretty good demonstration that, you know,

doesn't matter how powerful you are in afghanistan, somebody can get to you if they want to. >> what's the likely impact of this assassination going to be? >> well, i think it's pretty large, wolf. you know, arguably this was the second most important player in the afghan politics, after his half brother, hamid karzai, the president. ahmad wali karzai was the main power broker in kandahar, kandahar being, of course, the major city in southern afghanistan, the former heart lar heartland of the taliban. this man controlled most of the business and politics that went on there. and so, you know, what will replace him isn't really clear. he was certainly kind of a strong man and there have been rumors he was, you know, on the cia payroll. he's certainly being close to the united states government. in his absence, you know, who will be the person that kind of is the next strong man in kandahar is a pretty big question. i don't think we have an answer to that, wolf. >> over the years, as you well

know, peter, there have been all these accounts about wali karzai that he was a good guy, a bad guy, a drug dealer involved in the opium trade over there, making a lot of money. really hurting the united states. on the other hand, as you point out, some suggestions he was on the cia's payroll. give us some perspective who he was. >> well, you know, he did -- he was elected in 2005, so, you know, it wasn't that he just, you know -- he does have a popular base in kandahar. you know, kandahar and the neighboring province, helmand, are essentially the two largest provinces for opium growing anywhere in the world. although he's never been charged with drug smuggling, he's been alleged to have benefitted and certainly anybody at the top of the power structure in that area would probably benefit from the fact that drug smuggling is the main occupation, the main source of income and growing opium is the main source of income for

the population. that said, you know, he's never been charged of a crime in a u.s. court. it's one of those cases where different arms of the u.s. government had different kind of attitudes toward him. the drug enforcement administration took a pretty dim view of ahmad wali karzai, while, you know, reportedly the cia was also putting him on the payroll. it gets to the complexities and realities of what life is like in southern afghanistan, wolf. >> if i'm hamid karzai, the president of afghanistan or any top leader in afghanistan or any major u.s. official in afghanistan relying on these security guards, these afghan bodyguards, i'm taking another look at these guys who are well armed to see if the taliban has, in fact, infiltrated the whole security network over there. that's the big challenge right now. peter, we'll stay in close touch. thanks very much. james whitey bulger knew that the key to staying out of jail was laying low. he and his companion, catherine greig, did little to draw

attention to themselves, but in a hearing yesterday, greig, prosecutors showed behind closed doors the couple was anything but ordinary. deborah feyerick is joining us now. she has seen the evidence at the hearing. >> wolf, it appears reputed crime boss whitey bulger was ready to put up a fight. take a look at these weapons which fbi agents confiscated from the santa monica apartment. an assault weapon, 12 gage shot gun. revol revolvers. a silencer. even a darenger and a triple knife. the weapons were hided in the bathroom and living room walls of bulger's third floor apartment, along with stacks of hundred dollar bills. bulger and his longtime girlfriend, catherine greig, started baying cash for this rental 15 years ago soon after they disappeared from boston after getting a tip from a corrupt fbi agent. these pictures were presented during a detention hearing for miss greig in which her court

appointed attorney is asking she be released pending trail on charges of harboring a fugitive. prosecutors released a brief security camera video of miss greig. see her there walking in and out after a local drugstore picking up a prescription which prosecutors say was under a fake name. fbi agents finally captured bulger in june after running a public service announcement that focused on bulger's girlfriend and suspecting bulger might be armed, fbi agents lured him into the apartment garage placing a phone call saying someone had broken into his storage unit. we spoke to one source who tells us that when bulger was arrested, he told the arresting agent, quote, you did it the right way. now, bulger pleaded not guilty to 90 counts of murder and, wolf, the story gets more and more fascinating every day. we hope you're going to tune in when we go inside, bring you up close this coming sunday, july 17th, with my special, "stone cold killer." learn why whitey bulger became one of the most hated crime bosses in fbi history and why he may have felt safe in santa

monica. july 17th, 8:00 p.m., cnn presents "stone cold killer." >> we'll be watching. thanks very, very much. amazing story. the goal was to get dna from osama bin laden's family. we're hearing more details of an elaborate ruse they put out to get it. fox, the apparent company's foxing scandal. we're going to show you what fox viewers didn't see. i have copd. if you have it, you know how hard it can be to breathe and what that feels like.

copd includes chronic bronchitis and emphysema. spiriva helps control my copd symptoms... by keeping my airways open a full 24 hours. plus, it reduces copd flare-ups. spiriva is the only once-daily inhaled copd maintenance treatment that does both. and it's steroid-free. spiriva does not replace fast-acting inhalers for sudden symptoms. tell your doctor if you have kidney problems, glaucoma, trouble urinating, or an enlarged prostate. these may worsen with spiriva. discuss all medicines you take, even eye drops. stop taking spiriva and call your doctor right away if your breathing suddenly worsens, your throat or tongue swells, you get hives, vision changes or eye pain, or problems passing urine. other side effects include dry mouth and constipation. nothing can reverse copd. spiriva helps me breathe better. breathing with copd is no small thing. ask your doctor about spiriva.

♪ at great clips, quality and value have never looked more atractive. relax. you're at great clips. the latest round of talks on raising the u.s. debt limit ended at the white house a little while ago. let's go to chief white house correspondent jessica yellin. what are you hearing? any progress? >> reporter: wolf, i'm told there was no breakthrough in the meeting which ended a short time ago and it was a fairly bleak mood even going in, with a sense that both sides are more dug in. now, that unusual alternate proposal that was floated from senate minority leader mitch

mcconnell was discussed in the meeting, multiple sources tell me. it was one of several options discussed today in a meeting that several sources say was another day in which many parties believe there were more discussions and ongoing debate, but there's this growing sense from parties, wolf, that while there's a lot of political point scoring both before and after these meetings, there's just a lot of conversation that is not necessarily getting parties closer to a deal, wolf. >> where does everyone go from here? >> reporter: well, there are several options on the table. of course, there's this one you discussed on your show, being laid out by the senate minority leader. the president has said that tomorrow he would like these leaders all to come back and have more discussion, again. and there's talk in this town, now, that there could be some other options. for example, perhaps the politics in the house are just too challenging and there could be this other option where maybe the senate would go first. and the senate would come to a

deal. or, perhaps, the president would ultimately have to accept what he says he won't, this very short-term deal which he's flat-out ruled out. maybe in the end he'd have to. today the president said social security checks could potentially not go out on august 3rd if this deal isn't done. something has to get done. this thing has to be resolved quickly and they do have to find a solution, wolf, and, again, another day with no solution. so the stakes keep getting higher each day. >> yeah, we'll continue to watch it tomorrow. together with you, jessica. i write about this, by the way, on my blog at cnn.com/situationroom. about both sides exaggerating, exaggerating what's going on with some of their rhetoric. thanks very much. deborah feyerick is monitoring some of the other stop stories in "the situation room" right now including a service honoring the life of the former first lady, betty ford. let's going on on that front in. >> take a look at some of the live pictures there. those attending this funeral

service. we saw george w. bush there earlier. that is maria shriver. current and past first ladies are honoring the life of betty ford at her memorial service in palm desert, california. journalist cokie roberts will be a yule gist along with roslyn carter. ford asked her to celebrate the comrade that was once common in congress. ford died friday at the age of 93. she raised awareness of women's rights, cancer, alcoholism and substance abuse during and after her time in the white house. and iraq seems to be moving forward with plans to buy as many as 18 f-16 fighter jets. an american military spokesman said baghdad shelved the plans for the $3 billion sale several months ago but hopes to go ahead with the purchase. it requires a formal request and approval from congress and white house. most of the cost would be paid for with iraqi oil revenues. and scientists say there's a new reason to avoid go voivoi v.

up until now gonorrhea was easily treated with antibiotics. it's unclear how widespread a new strain is. researchers worry it could spread quickly. center for disease control and prevention estimate 700,000 americans get gonorrhea every year. japan says there's nothing to fear from meat con ttaminate from the fukushima plant. meat from six fukushima cows found its way to markets where it was probably sold and eaten. the official admitted the meat could pose a danger if it were eaten every day. in one cow the measured radiation was seven times the government limit. wolf? >> thanks very much for that. the plot to kill osama bin laden was about a lot more than helicopter and soldiers involved in a commando raid. new details suggest the cia enlisted a pakistani doctor and used a covert program to try to

get the al qaeda leader's dna. and so-called fair and balanced. fox news appearing to be taking an unbalanced approach in terms of its coverage involving the british media scandal that has been -- its owner. you're taking a closer look at that. we're going to take a closer look at that when we come back.

>> announcer: this past year alone there's been a 67% spike in companies embracing the cloud-- big clouds, small ones, public, private, even hybrid. your data and apps must move easily and securely to reach many clouds, not just one. that's why the network that connects, protects, and lets your data move fearlessly through the clouds means more than ever.

pakistan is detaining a doctor suspected of working with the cia in an elaborate ruse. it was reportedly designed to get dna samples from people inside the compound where it turned out osama bin laden was living. joining us now from islamabad, resa saya. walk us through what happened here. this is a pretty intriguing spy story, if you will. what happened? >> reporter: yeah, it's a fascinating glimpse, look, at the lengths the cia was going to find the location of bin laden in abbottabad. a pakistani security official is telling us the pakistani doctor is in custody suspected of helping the cia set up an intricate plot to confirm the whereabouts of osama bin laden. according to this official he set up a free vaccination

campaign to offer a free vaccination to the people of abbottabad where bin laden's compound was located. this doctor hired two nurses going around town from house to house, the plan towas to find t bin laden kids, to match their dna with the dna of bin laudedl sister who passed away in massachuset massachusetts. we talked to one of the nurses who was allegedly involved in this plot on the phone. she repeatedly told us she can't talk -- six of them told us, indeed, days before the raid two nurses were going around house to house offering vaccinations. we should note a u.s. official told "the guardian" paper this plot was, indeed, in place but didn't manage to get the dna samples necessary. a fascinating glimpse at what the cia was doing in the days leading up to the raid, wolf.

>> what do we know about this doctor? >> reporter: we don't know much about him. we know that's he's in custody. it's not clear why he's been arrested. it's not clear if he's going to be charged with a crime. what we do know is pakistan and the u.s. are not getting along in this, the relationship started to deteriorate after the raid on the bin laden compound. pakistan made it clear they weren't happy with the unilateral action taken by washington. many here view it as a violation of pakistan's sovereignty. there's several reasons why he's in custody. this could be a form of payback on the part of pakistan against washington. it also could be an effort by pakistan to find out exactly how the u.s., the cia, managed to set up an intricate intelligence network behind their back before this raid. wolf? >> have you really sensed, you've been in pakistan for a while now, reza. have you sensed the real deterioration in pakistani attitudes toward the united states since the bin laden raid?

>> reporter: i don't think this relationship has been at a lower point. again, it really started deteriorating after the raid on the bin laden compound. before that for years, you heard rhetoric, a lot of finger pointing. now both sides are making moves that could substantially change the complexion of this relationship. the u.s. holding back hundreds of millions of dollars in u.s. aid money. pakistan kicking out u.s. military trainers. so the relationship is struggling. at the same time, there's no evidence that it's going to end. i think despite the problems, these are two countries who recognize that they need one another, so i think in the coming weeks and months you're going to see these two countries despite the problems stagger forward in the relationship. >> reza, thanks very much. a scandal is rocking rupper murdo murdoch's media. how has fox use covered the scandal? new information coming in.

details of big changes in store for netflix customers. al. but for some of us with overactive bladder, our pipes just don't work as well as they should. sometimes, i worry my pipes might leak. but i learned there's something more i can do. now, i take care with vesicare. once-daily vesicare can help control your bladder muscle and is proven to treat overactive bladder with symptoms of frequent urges and leaks day and night. if you have certain stomach or glaucoma problems, or trouble emptying your bladder, do not take vesicare. vesicare may cause allergic reactions that may be serious. if you experience swelling of the face, lips, throat or tongue, stop taking vesicare and get emergency help. tell your doctor right away if you have severe abdominal pain, or become constipated for three or more days. vesicare may cause blurred vision, so use caution while driving or doing unsafe tasks. common side effects are dry mouth, constipation, and indigestion. so why wait ? ask your doctor today... ... about taking care with vesicare.

the media scandal involving

rupert murdoch's news apparentl fox news in a bit of a bind. network has gone out of its way to avoid a lot of reporting on its parent company troubles. that may become more obvious in the days to come. let's check in with brian todd. clearly they're doing some reporting on it, but by no means as much as other news organizations. >> it doesn't appear to be. there's been questions about the extent that rupert murdoch's news entities have covered the "news of the world" scandal. questioned fuelled in part by a clip from fox news watch. we'll show aw clip from this past sunday. this is streaming video. it's meant for the public but during a commercial and not part of the broadcast. analysts are talking about a certain news story. take a listen. >> anybody want to bring up the subject we're not talking about today for the streamers? >> sure, go ahead. >> no, go ahead. i'm not going to touch it.

>> with a ten foot -- >> no doubt they're talking about the "news of the world" scandal. despite the fact that news watch is about the news media, we found no mention of the "news of the world" scandal on that program, no mention of "news of the world" at all since august of 2006. it does appear to have been more extensive than that. "the l.a. times" does report that fox news stayed mainly silent about the scandal during prime time on thursday when it announced that murdoch was shutting down "news of the world." we found several mentions of fox news including one reporter piece. that's compared to the other major news networks where coverage was fairly extensive. we couldn't get a spokesperson for fox news to comment. we do have to say that our cnn colleagues in britain tell us that sky news, one of murdoch's

other news entities, was not holding back in its coverage, going all out on that throughout this. and for our search of the mention of the story on cnn turns up about 100 the past week. a fair question is are we overcovering that? you can ask that fairly of us. but you and i both saw clips on the broader fox news channel, several live shots. they've addressed it. >> what about the other murdoch newspapers? >> again, a mixed bag. as far as his u.s.-based newspapers are concerned, on the day after this was announced that "news of the world" was shutting down, we'll show you some newspapers now. this is the "new york post" extensive coverage of the casey anthony trial and verdict. a short mention of the "news of the world" scandal on page 29 there on the short news article. that's compared -- this again is on friday. this is the day after murdoch announced that "news of the world" is shutting down. a short mention there on page 29 on his "new york post" newspaper

which he owns. this is compared to "the new york times." on that friday announced "news of the world" was shutting down. same thing -- here it is right here. tabloid to close amid scandal with extensive coverage on the junk page. and murdoch's "the times of london" t headline murdoch counts cost as bskyb bid shelved. two of his major newspapers, wolf, "the wall street journal" reporting extensively on the web and on their front page and the "times of london" not shying away from this story. >> we'll have more opportunity to cover this story because it's clearly only just getting its investigation in britain. thanks very much. a senior official are saying that there's new developments going on in what's happening in afghanistan and iraq. we'll check those details for you. stay with us.

it's delicious. so now we've turned her toffee into a business. my goal was to take an idea and make it happen. i'm janet long and i formed my toffee company through legalzoom. i never really thought i would make money doing what i love. [ shapiro ] we created legalzoom to help people start their business and launch their dreams. go to legalzoom.com today and make your business dream a reality. at legalzoom.com we put the law on your side.

unlike fish oil, megared softgels are small and easy to swallow with no fishy smell or aftertaste. try megared today. this just coming in. a senior u.s. official tells cnn that cia agents traveled to somalia. it was only once or twice and

the suspects were under control of somali forces the entire time. cia agents helped by suggesting questions. the agency believes the somali-based al qaeda offshoot may be increasing its contacts with terrorists in yemen. the u.s. mission by agents underscores the government's concern about terror networks in the region. let's go back to jack. he's got the cafferty file. >> the question this hour is michele bachmann is leading in iowa. sarah palin thinks she can be president. are the republicans in trouble? brandon in arkansas. i believe so. as an independent i find that republicans have a problem finding candidates who actually recognize the problems faced by this country. michele bachmann and sarah palin may evoke enormous amounts of patriotism, but i believe it takes much more than that. if it comes down to ron paul and president obama, my vote will go to ron paul. however, if i have to choose between other republican candidates, my vote will likely go to president obama.

riley writes if even 20% of this country really thinks either of those people is presidential, the rest of the country is in trouble. i don't think the country holds that many dummies. michael, the only way that bachmann or palin should be allowed into the white house is with a ticket and a tour guide. honestly, their advocacy of the theocratic government frightens me. we've tried that already. it was called the dark ages, and it worked out so well. janie write, yes, republicans are in trouble. sarah pale san has been just looking to make a few more bucks before her looks fade. bachmann is a joke. just lost the black vote with her stupid remark about black babies and slavery. this woman will continue to support our president. if not, the u.s. deserves a republican president. the whites will suffer right along with the blacks and hispanic. bob writes four years ago who would have thought a first term black senator from illinois would beat out hillary clinton

let alone become president? don't underestimate the president's unpopularity. t. writes i am starting a medical practice based on the fact that i believe being a republican is a choice, it's not inevitable. otis, let's see. you've got a couple of schizophrenics, romney and huntsman a set of wingnut, paul, santorum and cain, two certifiable alones, bachmann and palin, an insufferable bore, pawlenty and a skirt chasing windbag, gingrich. yes the gop is in trouble with this group of luminaries. unless sanity is restored, it's headed for extinction. if you want to read more, go to my blog, cnn.com/caffertyfile. >> it could really liven up in the days and the weeks that mary matalin and james carville are correct in their assumption right now that sarah palin is getting ready to throw her hat in the ring as well. we'll watch that closely together with you, see you back here tomor